Experience Invest: Expanding UK Private Rental Sector

October 21, 2019

Experience Invest Shares about the UK private rented sector



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The latest research from Knight Frank has forecast that £75 billion of investment will be committed to the professionally-managed Private Rented Sector (PRS) by 2025. The Multihousing report, released today, reveals the key trends that are set to dominate the private rented sector along with insights from tenants and investors. Some of the key findings include: 

  • Young professionals (aged 25-34) no longer make up the largest group living in the PRS, having been overtaken by 35 to 49-year-olds (but only very slightly). This age group is also expected to show the biggest growth in households in the PRS over the coming years, with difficulty in obtaining a mortgage deposit to buy a home remaining a hurdle
  • Affordability remains the key priority for 61% of tenants when choosing a property. More than one in ten tenants said renting allowed them to live in an area they could not otherwise afford
  • Location is the second biggest priority for tenants(23%) followed by the size of the property (10%) 
  • Lack of a mortgage deposit remains a key driver for renting, though this ranges from 71% of young families to just 41% of iGens (those aged under 25)
  • On average, 69% of tenants still expect to be renting in three years’ time, rising to 93% for Baby Boomers (aged 65+)
  • Tenant priorities are more focused on ‘internal’ factors – amenity within an apartment – than ‘external’ factors – such as local shops. 
The research also provided some interesting insights into regional trends. Respondents said just over half (53 per cent) of their current investment is in London, but this proportion is expected to fall to 44 per cent over the next five years. Regional locations could, therefore, be the focus of 56 per cent of all professionally managed PRS investment activity in five years’ time, which is in line with figures showing that 56 per cent of units currently under construction are in the regions.

In seven years’ time, large-scale professional landlords will have invested or committed £75 billion to the UK’s private rented sector. There is a bright outlook for specific asset classes, particularly student accommodation, which is on course for another year of high activity, according to Knight Frank. Investors committed to this and other promising segments in the UK’s rental property market can expect to see strong returns in 2019 and beyond.

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Experience Invest is a UK property consultancy that provides industry-leading UK property investment opportunities. Experience Invest also helps individual buyers to achieve high rental returns from asset classes that were traditionally reserved for institutional investors and funds. If you want to find out more about investment opportunities available right now, contact Experience Invest here. Alternatively, you can also find out more about Experience Invest on the Think Luton profile page here. Read more Experience Invest reviews on Freeindex and Experience Invest reviews on LinkedIn.

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